Britam nets Sh7 billion from bond

Insurance firm Britam has recorded a 147 per cent oversubscription of its corporate bond issued last month to help fund the company’s expansion.

The firm said in a statement Wednesday that it had raised Sh7.4 billion against a target Sh3 billion.

“The massive participation in the corporate bond is a validation of the confidence the market has in the group. The funds will give us the additional impetus needed to take our group to the next level of growth in line with our strategic plan,” managing director Benson Wairegi said.

The bond had a green shoe option of Sh3 billion and will see the firm take up Sh6 billion as approved by the Capital Markets Authority.

Listed on the NSE

“The transaction saw great participation from leading fund managers contributing 50.9 per cent, banks and insurance companies jointly at 41 per cent and retail investors at 8.1 per cent of the total raised,” Mr Paul Orem chief executive of Dyer and Blair, which was the lead transaction adviser, said.

The corporate bond will be listed on the NSE at the end of the month.

The firm has embarked on a national expansion plan that saw it last month announce its intention to acquire Equity Bank’s 24.6 per cent shareholding in mortgage firm Housing Finance.

The deal, to cost slightly over Sh2 billion, is expected to strengthen Britam’s hold of the real estate sector where it has been trying to make a foray with a view to diversifying revenue sources. It will strengthen its grip on the mortgage insurance market.

“Britam will utilise the funds to further regional and local expansion, acceleration of property development and to increase investment in private equity,” the firm said.